Hon Hai, better known by tradename Foxconn, agreed to spend $10 billion constructing a factory producing liquid-crystal display panels. The screens will be used for televisions and displays in cars and health care and other devices.

The Milwaukee signing followed Wednesday’s White House announcement by Gou and President Trump of the deal.

For the moment, America’s political leaders are talking about the jobs the Foxconn plant will create for Americans. U.S. workers, once the victims of “outsourcing,” are now the beneficiaries of “reshoring,” the return of manufacturing to the U.S.A. These days, manufacturers want to be as close as possible to impatient consumers and corporate customers.

But there is also another reason that will soon fuel reshoring: perceptions of growing trade and geopolitical risk.

At this moment, however, all the talk is about jobs. Taiwan-based Foxconn says it will initially put 3,000 to work at the Wisconsin facility. The company plans to eventually employ 13,000 there at an average pay of almost $54,000.

And if you don’t think you will work for Foxconn, you can still benefit. Governor Walker believes the plant will create 10,000 construction jobs and about 22,000 indirect ones. As Alan Tonelson, a Washington-D.C.-based trade expert, noted in comments to me about the Foxconn investment, manufacturing has a “huge jobs-multiplier effect, by many estimates, the economy’s biggest.”

Foxconn’s plans certainly pleased President Trump. At the White House ceremony with Gou, the American leader put it this way: “American jobs—that’s what we want.”

Foxconn is great at creating jobs. In China, it took a labor-intensive model of manufacturing, enlarged the scale beyond imagination, and prospered. Its Shenzhen factory complex, Foxconn City, once employed close to a half-million workers.

His company in China started in coastal areas—Shenzhen is next to Hong Kong—and then, when wages soared and workers refused to travel to the coast for employment, he opened new facilities in the Chinese hinterland, most notably Chengdu in Sichuan province.

And to solve seemingly intractable personnel problems—at one point he had to erect nets to catch suicidal workers jumping off factory dormitory buildings in Shenzhen—he led the way in automation, installing robots, called “Foxbots,” in army-sized contingents.

Since then, he has also tried to diversify by moving to locations outside China. Initial efforts have not met with success, largely because it has been hard to replicate the factors that make Chinese manufacturing so cheap and efficient.

Gou’s company famously announced plans for India, Indonesia, and Vietnam but has been roundly criticized for not carrying through. Moreover, you can scour central Pennsylvania for the $30 million Foxconn facility announced in 2013, but you will not find it. Dow Jones’s MarketWatch site says, with justification, that the company has a “history of broken promises.”

Some observers, therefore, have wondered whether the Wisconsin factory will ever open its doors. Yet there are reasons why it will. As an initial matter, Tonelson, the trade analyst, says Gou seems motivated to build products in the U.S. to eliminate tariffs.

And there are two obstacles that Gou cannot overcome if he stays in China. First, there is the belief that, for competitive reasons, companies need to be close to customers and delivery times must be as short as possible. Two-week ocean crossings and several more days for unloading, Customs clearance, and reloading at Long Beach are increasingly considered unacceptable.

“In the new world,” Josh Boak and Paul Wiseman of the Associated Press write, “making products in faraway low-wage countries like China can be a disadvantage: It can take too long—weeks, months—to ship finished products to the United States.”

Weeks? Months? At some point, shipping finished products to the U.S. may not be possible. And that brings us to the second reason Foxconn has every reason to locate production to American soil: trade and geopolitical risk. Once thought to be minimal, such risks loom larger as companies are beginning to realize that patience with China has run thin in the American electorate and even in Washington.

The unexpected collapse of trade negotiations between China and the U.S. on the 19th—Treasury Secretary Steven Mnuchin and Commerce Secretary Wilbur Ross did not try to hide the failure of the U.S.-China Comprehensive Economic Dialogue this month—suggests that Sino-U.S. relations are going to deteriorate fast.

And the deterioration will be seen in other areas. Ties could reach the breaking point because of, for instance, China’s support of North Korea, its attempts to grab the territory of neighbors, and Beijing’s cyberattacks against American networks.

All of these are important, but what could end decades-old relations is the killing or maiming of American service personnel. A Chinese pilot last Sunday endangered the crew of a U.S. Navy EP-3 reconnaissance plane in international airspace over the East China Sea by first flying under the slow-moving American craft and then pulling up only 300 feet in front of it, nearly causing a collision. The EP-3 normally carries a crew of 24.

China for two decades has caused dangerous intercepts in the skies and on the seas with distressing frequency, fortunately without American injuries or loss of American life. Yet should the Chinese harm Americans in the future—and it looks like just a matter of time before one of China’s pilots or sailors badly miscalculates—there could be long-term disruption in trade across the Pacific.

Therefore, Terry Gou looks prudent, avoiding business-killing risks by planning to build a rather large factory in a state called Wisconsin.